FILE – In this July 30, 2008 file photo illustration, a silhouetted coaxial cable with the Comcast Corp. logo in the background is seen in Philadelphia. The FCC hopes to establish the legal underpinning for its push to write so-called “network neutrality” regulations _ which are intended to prevent phone and cable companies from abusing their control over the market for high-speed Internet access _ in a closely watched court battle between the agency and the nation’s biggest cable operator. (AP Photo/Matt Rourke, File)

Apple Inc. is in talks with Comcast Corp. about teaming up for a streaming-television service that would use an Apple set-top box and get special treatment on Comcast’s cables to ensure it bypasses congestion on the Web, people familiar with the matter say.

The discussions between the world’s most valuable company and the nation’s largest cable provider are still in early stages, and many hurdles remain. But the deal, if sealed, would mark a new level of cooperation and integration between a technology company and a cable provider to modernize TV viewing.

Comcast is the dominant cable and Internet provider in the Twin Cities.

Apple’s intention is to allow users to stream live and on-demand TV programming and digital-video recordings stored in the “cloud,” effectively taking the place of a traditional cable set-top box.

Apple would benefit from a cable-company partner because it wants the new TV service’s traffic to be separated from public Internet traffic over the “last mile”–the portion of a cable operator’s pipes that connects to customers’ homes, the people familiar with the matter say. That stretch of the Internet tends to get clogged when too many users in a region try to access too much bandwidth at the same time.

Apple’s goal would be to ensure users don’t see hiccups in the service or buffering that can take place while streaming Web video, making its video the same quality as Comcast’s TV transmissions to normal set-top boxes.

While devices such as Microsoft’s Xbox gaming console and Roku’s set-top box have made some inroads in the TV industry, none offer the kind of fully formed TV service, with the guarantee of network quality, that Apple desires.

Apple has spent several years exploring various avenues to enter TV, but it has been unable thus far to find business models that media companies and cable providers find appealing.

Getting the support of Comcast would give Apple’s plans a big boost. The companies share a common goal: advancing set-top box technology so that TV more closely resembles the easy-to-use apps and streaming-video services to which consumers are growing accustomed. Innovation is becoming a high priority for content-owners and operators amid pay-TV subscriber losses and fears that a younger generation of consumers will forgo paying for TV altogether.

Apple and Comcast aren’t close to an agreement, said one person familiar with the talks. Delivering the service quality Apple envisions would require Comcast to make significant investments in network equipment and other back-office technology, according to people familiar with Comcast’s thinking.

The companies also differ on how deep a relationship Apple should have with Comcast’s customers. Apple has proposed that users would sign on to the new device using Apple login IDs, and it is interested in controlling customer data, the people familiar with the matter said. Apple also has asked for a cut of the monthly subscription fees paid by customers, these people said.

Comcast wants to retain significant control over the relationship with customers and the data.

Furthermore, Apple must acquire significant TV programming rights from media companies, one of the people said. Comcast would want to ensure that the price Apple has to pay to acquire rights wouldn’t cause the service to be priced higher than traditional pay-TV service, this person said.

Apple has had discussions since at least mid-2012 with Time Warner Cable, the No. 2 operator, people familiar with the matter said. Those talks, known internally at Time Warner Cable as “Project Jupiter,” came to a standstill when the cable operator became a takeover target, the people said. Comcast in February agreed to acquire Time Warner Cable for $45 billion, a deal regulators are reviewing that would give Comcast a total of 30 million U.S. customers, after proposed divestitures.

Under the plan Apple proposed to Comcast, Apple’s video streams would be treated as a “managed service” traveling in Internet protocol format — similar to cable video-on-demand or phone service. Those services travel on a special portion of the cable pipe that is separate from the more congested portion reserved for public Internet access.

People familiar with the matter said that while Apple would like a separate “flow” for its video traffic, it isn’t asking for its traffic to be prioritized over other Internet-based services.

Those distinctions are important because of merger conditions Comcast agreed to as part of its 2011 acquisition of NBCUniversal. Those “net-neutrality” restrictions, which will be in place through 2018, say Comcast cannot “unreasonably discriminate” in how it transmits network traffic.

The Federal Communications Commission is in the process of drafting net- neutrality rules for the broadband industry after the U.S. Court of Appeals for the District of Columbia in January tossed out an earlier set of regulations the agency had in place.

The FCC has signaled that its new rules will prevent Internet service providers from blocking or slowing down access to Web content providers that don’t pay a toll. It isn’t clear what approach the FCC will take to a situation in which a provider such as Apple wants enhanced treatment for a cloud-based service in partnership with an operator.

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